CBL & Associates Properties, Inc. Announces Future Redevelopment Plans for
JCPenney Locations
Business Wire
CHATTANOOGA, Tenn. -- January 15, 2014
CBL & Associates Properties, Inc. (NYSE:CBL) announced future
redevelopment/replacement plans for JCPenney anchor locations in the CBL
portfolio that are expected to close in 2014.
“One of our most attractive investments coming out of the recession has been
to improve the performance of our properties through redeveloping
underperforming anchor locations. The opportunities created by the four
JCPenney closures announced today fit perfectly with that objective,” said
Stephen Lebovitz, president & CEO. “While we have been encouraged by
JCPenney’s recent improvements in sales and traffic, we have been anticipating
certain store closures to occur. As we said in our most recent earnings call,
we have been proactively engaging in discussions and gauging retail demand
with this in mind and are pleased to announce strong interest for the
locations expected to close in 2014. Our next steps will be to move forward
with negotiations with retailers and finalize redevelopment plans. Once leases
are signed, we will share specific retail names joining each mall, as well as
construction and opening timelines. The list of retailers interested in these
specific locations includes sporting goods, arts and crafts and other box
retailers, as well as a traditional department store for one location, all of
which will enhance the performance of the malls overall.”
JCPenney announced its intention to close four locations in the CBL portfolio
at Hickory Point Mall in Forsyth, IL, Janesville Mall in Janesville, WI,
Wausau Center in Wausau, WI, and Northgate Mall in Chattanooga, TN. CBL
anticipates store closures to occur in the second quarter. Three locations are
leased from CBL. The Northgate Mall store is leased from a third party and CBL
will work with the building owner to facilitate its redevelopment. The stores
aggregate approximately 499,000 square feet and $1.4 million in gross annual
rent. JCPenney will continue to pay rent until lease expiration.
Lebovitz added, “As part of our review process, we analyzed the co-tenancy
provisions in small shops leases at these properties and determined that the
financial exposure is immaterial. The significant and diverse retail demand
for each location demonstrates the strength and resilience of our dominant
mall properties. We look forward to the improved growth rates generated from
these enhancements.”
Over the past three years, CBL has added or redeveloped more than 75 anchor
and junior anchor locations to its portfolio comprising more than 2.2 million
square feet. Today, other than locations under redevelopment, CBL has no
vacant anchor locations in its core portfolio. The JCPenney stores that are
closing are all prominently located in their malls with convenient parking and
prime visibility, which will facilitate their repurposing. Based on CBL’s
extensive track record of successful anchor redevelopment, similar projects
have generally required 12-24 months to complete and an investment of $5–10
million generating initial unleveraged returns in the range of 7-10%. More
specific cost and return information regarding the four locations will be
announced as plans are finalized.
About CBL & Associates Properties, Inc.
CBL is one of the largest and most active owners and developers of malls and
shopping centers in the United States. CBL owns, holds interests in or manages
150 properties, including 88 regional malls/open-air centers. The properties
are located in 29 states and total 84.4 million square feet including 4.4
million square feet of non-owned shopping centers managed for third parties.
Headquartered in Chattanooga, TN, CBL has regional offices in Boston
(Waltham), MA, Dallas (Irving), TX, and St. Louis, MO. Additional information
can be found atcblproperties.com.
Forward-Looking Statements
Information included herein contains "forward-looking statements" within the
meaning of the federal securities laws. Such statements are inherently subject
to risks and uncertainties, many of which cannot be predicted with accuracy
and some of which might not even be anticipated. Future events and actual
events, financial and otherwise, may differ materially from the events and
results discussed in the forward-looking statements. The reader is directed to
the Company's various filings with the Securities and Exchange Commission,
including without limitation the Company's Annual Report on Form 10-K and the
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" included therein, for a discussion of such risks and
uncertainties.
Contact:
CBL & Associates Properties, Inc.
Katie Reinsmidt, 423-490-8301
Senior Vice President - Investor Relations and Corporate Investments
katie_reinsmidt@cblproperties.com